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GARRARD JAPAN: GLOBAL OR LOCAL Case Solution & Answer

GARRARD JAPAN: GLOBAL OR LOCAL

Introduction

Garrard Japan was established in 1930. It is an entirely owned subsidiary of Garrard S.A, which is a leader in the packaged food industry. The industry is divided in five largest companies, with global market share of not more than 10%. The industry has a net worth of $2.11 trillion, and Garrard Japan had generated $4billion revenue in 2016. Garrard has 20 production, sales and distribution areas across the country. The company is globally expended but it is engaged in the local markets and their cultures as well. There are numerous brands which Garrard Japan is selling. The company has 6000 employees who are employed in different departments, who generate $1.4 billion Japanese goods and services per year. The company is able to sale food products but it is not responsible for their taste. There are some products which are made by the company and others are out-sourced by the company. The CEO of the company is Toshio Tanaka who had joined the company in 1990, in sales and marketing, and became the CEO in 2013. He has a team of 11 employees who report directly to him, including: 4 production heads and 7 operational heads.

In 2017, September, Tanaka observed that there is a number of things which are not running according to globalization. The European based multinational enterprise, a main contributor of globalization of trade and commerce as well as the market survey results, had shown a Japanese opinion that 64% of the Japanese are engaged in operations for the purpose of generating profit but not for the satisfaction of the local needs and customers, 50% of MNEs were impersonal, and there is a 41% of the bureaucratic. This survey showed many other results as the global and local strategies of the company. The rating of Garrard Japan is 3.5 from the scale of 1 to 10. This raking is not higher, but it is a median raking as compared to the competitors of the industry. Tanaka had asked a meeting for the scope of improvement of the global rating scale..

Question no. 1

The purpose of MNEs is to expend locally and globally, for the purpose of satisfying the needs and wants of not just local but international customers as well. For this, the MNEs respond to the needs according to the culture technical standards, distribution facilities, national rules and regulations, domestic and international competitors, preferences of customers, and infrastructure. But, the Garrard Japan is not concentrating on the needs of its customers, instead, it is more emphasized over generating profits. The anti-globalization barriers cause Garrard to be lower rated as compared to its competitors, caused by its lack of focus on the local and global needs and the international policies. There are some more reasons for the anti-globalization, such as: the demographic changes in economies, the new distribution channels and the product portfolio.

Question no. 2

The flat world view state the level playing field for commerce and where all the competitors have equal opportunities to compete in the market. The company is globally expended with 10% of global shares. The company is global in terms of trade. The global strategy of the company was to design business model, which could meet the improvements for the unsustainability in demographics, distribution channels and product portfolio. MNEs offers homogenous products across the globe, meeting the global needs of the markets.

Multi-domestic view is a strategy in an international market, which focuses on advertisement and commerce for local markets needs rather than global expansion. The company in Japan has 14% customers from the total population. From that 14%, the company made¥19860 billion sales in 2016. This is a very low ratio of for the company by which the producers are doing their best in focusing on the production with added value rather than growing the sales volume. The customers in Japan normally purchase ready to eat meal, but because of the dissatisfying products of the company the customers have less inclination towards the company’s products. Moreover, the company also lacks in the provision of online ordering facilities to the customers, due to which the customers often get discouraged from buying products as they would be required to walk to the stores rather than getting their ordered items delivered to them at their doorsteps.

Question no. 3

Garrard S.A has the goal, which is that quality assurance as the main motive of the company in order to provide quality products to its customers. It says “Ensuring quality of life through healthy foods” as its slogan, which the company has maintained. The company always wanted to be a global business by serving its customers as per their needs. The employees of the company are also ready to work according to the strategy of globalization, and they have three things to keep in mind as equity, diversity of products, and sustainability.

The Garrad has also planned for the local strategies to be developed for its customers in local markets and providing them the facilities which they haven’t ever thought of. There were great needs of local mangers to manage the distribution problems. There are many local managers who have their control in headquarters. In local markets of the business; there is a development and Garrard also offers the unbranded penal of local products. The company also wants to sell some imported products in local markets, for which will be testing the responses of the consumers after tasting. Headquarters are also using strategies for globalization and localization by re-arranging the records of local business and international markets. The portfolio management tools also help the company to achieve its local and global goals.

Question no. 4

Hofstede’s Framework

Power Distance: Japan is at an intermediate of 54 score in hierarchical society, because Japanese are always conscious about their hierarchical position in the social settings.

Individualism: Japan scores 46 in individualism. This means the degree of interdependency of the  society is 46. Japanese live separate rather than living in joint families.

Masculinity: Japan has high score in feminine, which is 95, but is has most of masculine societies of the globe. The culture of Japan states that women are the in charge of the whole family.

Uncertainty Avoidance: Uncertainty avoidance of Japan is 92, which means that the country is continuously facing natural disasters, such as: like earthquakes and tsunamis etc.

Long term Orientation: Japan scores 88 in long term orientation. People live with practical good examples and in virtue guidance.

Indulgence: Japan has low score as 42, which means that Japan has the tendency of cynicism and pessimism.

Hall’s Culture Factors

Context: This includes high and low context. Japan is in high context, as the people understand and follow the rules.

Time: This includes monochromic and polychromic time. Japan is polychromic as it does many things at once, achieves goals and put relationships first. Japan is considered to be very multitasking.

Space: It has a need of space, as people own less space in Japan, which means that Japan has a focus on its traditions and territoriality is lower in Japan, as there are less ownerships of space.

Information: It has slow and fast flow. Japan is slow flow which means the country does everything with planning and focus on task.

The CEO should opt for the improvement strategies as the globalization and localization, with respect to the satisfaction of consumer rather than just the company’s itself. Extraordinary efforts should be carried out by the CEO to improve the general senior administration for company’s goodwill.

Conclusion

The company is facing problem of lower rating in local and global areas. There are three issue the company is exposed to, out of which, first is the investment in creating customers demand by ensuring them of quality products, second is the budget for corporate campaigns as the company does not spend huge amounts in television advertisement, print advertisement or any other promotional areas. Third dilemma which the company has been faced with, is the conceptual difficulties in tailoring products advertisement. The CEO wants to remove these issues by implementation of strategies, which would result in a significant improvement for the company. The present company of Garrard is specific in its goals as they have to serve best to their local and global customers, and its employees are also working with them, Garrard should also make the culture for long term profitability and consumer satisfaction,  and should also plan on strategies to increase its products and quality ranking….

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